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Townsquare Reports An All-Time Record Adjusted EBITDA And Strong Net Revenue Growth

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·18 min read
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Adjusted EBITDA Exceeds 2019 Levels for the Third Consecutive Quarter

Delivers Record High Townsquare Interactive Net Subscriber Adds (+1,350 in Q2)

Digital Revenue 47% of Total Net Revenue in 1H 2021

PURCHASE, N.Y., Aug. 3, 2021 /PRNewswire/ -- Townsquare Media, Inc. (NYSE: TSQ) ("Townsquare", the "Company," "we," "us," or "our") announced today financial results for the second quarter ended June 30, 2021.

Townsquare Media, Inc.
Townsquare Media, Inc.

"Townsquare's strong performance continued in the second quarter of 2021, with significant growth in net revenue, Adjusted EBITDA, net subscribers and net income. In the second quarter of 2021, net revenue increased +45% year over year, but more importantly, Townsquare achieved 99.4% of Q2 2019's net revenue when excluding Live Events net revenue (in Q2 2019 there was $6.3 million of Live Events net revenue). Total digital revenue growth accelerated to +36% year over year (+27% vs. Q2 2019), contributing approximately 47% of Townsquare's total net revenue in the first six months of 2021. Over the next three years, we expect double-digit digital net revenue growth to continue, fueling the growth of our digital platform from $180 million of revenue (on a trailing twelve-month basis as of June 30, 2021) to $250 million," commented Bill Wilson, Chief Executive Officer of Townsquare Media, Inc. "Most impressively, I am extremely proud to report that Townsquare's second quarter Adjusted EBITDA of $30.3 million not only exceeded our expectations, our previously stated guidance, and 2019 levels (+1% vs. Q2 2019), but it was also the highest Adjusted EBITDA generated in any single quarter in Townsquare's history. To accomplish this strong result only one year after the start of the pandemic is a testament to the strength of the Townsquare Team, our digital platform and solutions for local businesses, and our careful expense management efforts."

Mr. Wilson continued, "As a Digital First Company, our digital revenue and profit growth has accelerated, driving the diversification of our business, total Company growth and separation from our local competition. I am incredibly optimistic about Townsquare's future, and very proud that we are on the path to achieving 2019's Adjusted EBITDA in 2021, on the verge of a full revenue recovery in 2021, and plan on delivering strong revenue and profit growth in 2022."

Second Quarter Highlights*

  • As compared to the second quarter of 2020:

  • Net revenue excluding Live Events achieved 99.4% of Q2 2019 levels

  • Diluted income per share was $0.50, and Adjusted Net Income per diluted share was $0.53

  • Townsquare Interactive added approximately 1,350 net subscribers, achieving an all-time record high number of quarterly net subscribers

Year to Date Highlights*

  • As compared to the six months ended June 30, 2020:

  • Net revenue excluding Live Events achieved 99.8% of 1H 2019 levels

  • Generated Cash Flows from Operations of $31.2 million

  • Issued $550.0 million of 6.875% senior secured notes due 2026

  • Completed the repurchase of 100% of Oaktree Capital's equity interest in the Company for $6.40 per security, representing a 19% discount to the pre-announcement share price (39% as of the March 9, 2021 closing date)

  • Townsquare Interactive added approximately 2,200 net subscribers

*See below for discussion of non-GAAP measures.

Segment Reporting
We have three reportable operating segments, Townsquare Interactive, our digital marketing solutions subscription business, Advertising, which includes broadcast and digital advertising products and solutions, and Live Events, which is comprised of the Company's live events, including concerts, expositions and other experiential events.

Quarter Ended June 30, 2021 Compared to the Quarter Ended June 30, 2020

Net Revenue
Net revenue for the quarter ended June 30, 2021 increased $33.3 million, or 44.9%, to $107.3 million, as compared to $74.1 million in the same period last year. Townsquare Interactive net subscription revenue increased $3.3 million, or 19.7%, to $20.2 million, Advertising net revenue increased $28.8 million, or 50.4%, to $85.9 million, and Live Events net revenue increased $1.2 million to $1.2 million, each as compared to the same period last year. Excluding political revenue, net revenue increased $33.4 million, or 45.7%, to $106.6 million, and Advertising net revenue increased $28.9 million, or 51.4%, to $85.2 million.

Adjusted EBITDA
Adjusted EBITDA for the quarter ended June 30, 2021 increased $28.2 million to $30.3 million, as compared to $2.1 million in the same period last year. Adjusted EBITDA (Excluding Political) increased $28.3 million to $29.6 million, as compared to $1.3 million in the same period last year.

Net Income (Loss)
Net income for the quarter ended June 30, 2021 increased $36.9 million to $10.1 million, as compared to net loss of $26.8 million in the same period last year.

Six Months Ended June 30, 2021 Compared to the Six Months Ended June 30, 2020

Net Revenue
Net revenue for the six months ended June 30, 2021, increased $28.6 million or 17.1%, to $196.1 million, as compared to $167.5 million in the same period last year. Townsquare Interactive net subscription revenue increased $5.8 million, or 17.4%, to $39.2 million, Advertising net revenue increased $24.0 million, or 18.2%, to $155.7 million, and Live Events net revenue decreased $1.2 million, or 50.0%, to $1.2 million, each as compared to the same period last year. Excluding political revenue, net revenue increased $29.6 million, or 17.9%, to $194.9 million, and Advertising net revenue increased $25.0 million, or 19.3%, to $154.5 million.

Adjusted EBITDA
Adjusted EBITDA for the six months ended June 30, 2021, increased $32.8 million to $50.4 million, as compared to $17.6 million in the same period last year. Adjusted EBITDA (Excluding Political) increased $33.7 million to $49.4 million, as compared to $15.7 million in the same period last year.

Net Income (Loss)
Net income for the six months ended June 30, 2021, increased $90.4 million to $4.0 million, as compared to net loss of $86.4 million in the same period last year. Net loss in 2020 was primarily driven by approximately $107.1 million of non-cash impairment charges to our FCC licenses.

Liquidity and Capital Resources
As of June 30, 2021, we had a total of $25.1 million of cash and cash equivalents and $550.0 million of outstanding indebtedness, representing 5.8x and 5.5x gross and net leverage, respectively, based on Adjusted EBITDA for the twelve months ended June 30, 2021 of $94.9 million.

The table below presents a summary, as of July 30, 2021, of our outstanding common stock, and securities convertible into common stock, excluding options issued under our 2014 Omnibus Incentive Plan.

Security


Number Outstanding


Description

Class A common stock


12,176,369



One vote per share.

Class B common stock


815,296



10 votes per share.1

Class C common stock


3,461,341



No votes.1

Warrants


162,696



Each warrant is exercisable for one share of Class A common stock, at an exercise price of $0.0001 per share. The aggregate exercise price for all warrants currently outstanding is $16.2

Total


16,615,702




1 Each share converts into one share of Class A common stock upon transfer or at the option of the holder, subject to certain conditions, including compliance with FCC rules.

2 The warrants are fully vested and exercisable for shares of Class A common stock, subject to certain conditions, including compliance with FCC rules.

Conference Call
Townsquare Media, Inc. will host a conference call to discuss certain second quarter 2021 financial results on Tuesday, August 3, 2021 at 8:00 a.m. Eastern Time. The conference call dial-in number is 1-877-407-0784 (U.S. & Canada) or 1-201-689-8560 (International) and the confirmation code is 13721452. A live webcast of the conference call will also be available on the investor relations page of the Company's website at www.townsquaremedia.com.

A replay of the conference call will be available through August 10, 2021. To access the replay, please dial 1-844-512-2921 (U.S. and Canada) or 1-412-317-6671 (International) and enter confirmation code 13721452. A web-based archive of the conference call will also be available at the above website.

About Townsquare Media, Inc.
Townsquare is a community-focused digital media, digital marketing solutions and radio company focused outside the Top 50 markets in the U.S. Our assets include Townsquare Interactive, a digital marketing services subscription business providing websites, search engine optimization, social platforms and online reputation management for approximately 24,950 SMBs; Townsquare IGNITE, a proprietary digital programmatic advertising technology with an in-house demand and data management platform; and Townsquare Media, our portfolio of 322 local terrestrial radio stations in 67 cities with corresponding local news and entertainment websites and apps including legendary brands such as WYRK.com, WJON.com, and NJ101.5.com along with a network of national music brands including XXLmag.com, TasteofCountry.com, UltimateClassicRock.com and Loudwire.com. For more information, please visit www.townsquaremedia.com, www.townsquareinteractive.com, and www.townsquareignite.com.

Forward-Looking Statements
Except for the historical information contained in this press release, the matters addressed are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements often discuss our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as "aim," "anticipate," "estimate," "expect," "forecast," "outlook," "potential," "project," "projection," "plan," "intend," "seek," "believe," "may," "could," "would," "will," "should," "can," "can have," "likely," the negatives thereof and other words and terms. By nature, forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected or implied by the forward-looking statement. Forward-looking statements are based on current expectations and assumptions and currently available data and are neither predictions nor guarantees of future events or performance. You should not place undue reliance on forward-looking statements, which speak only as of the date hereof or as of the date specified herein. Risks and uncertainties that could have a material impact on our business and financial results include, but are not limited to, general economic conditions in the United States, or in the specific markets in which we currently do business, industry conditions, legislative or regulatory requirements, the continuation or worsening of the effects from the COVID-19 pandemic, its scope, duration and impact on our business, financial results, cash flows and liquidity, as well as the impact on our clients and customers, the success of our mitigation efforts in response to the COVID-19 pandemic, our performance in any recovery from the COVID-19 pandemic, the performance of financial and credit markets, our ability to comply with the covenants and obligations under our outstanding debt, including meeting required payments of principal and interest, our ability to access debt or equity capital on attractive terms or at all, potential downgrades to our credit ratings, and certain other events, including future disease outbreaks and pandemics. See "Risk Factors" and "Forward-Looking Statements" included in our Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on March 16, 2021, for a discussion of additional factors that could cause our actual results to differ from those expressed or implied by forward-looking statements. Townsquare Media, Inc. assumes no responsibility to update any forward-looking statement as a result of new information, future events or otherwise.

Non-GAAP Financial Measures and Definitions
In this press release, we refer to Adjusted Operating Income, Adjusted EBITDA, Adjusted EBITDA (Excluding Political), Adjusted Net Income and Adjusted Net Income Per Share which are financial measures that have not been prepared in accordance with generally accepted accounting principles in the United States ("GAAP").

We define Adjusted Operating Income as operating income before the deduction of depreciation and amortization, stock-based compensation, corporate expenses, transaction costs, business realignment costs, impairment of goodwill, long-lived and intangible assets and net loss (gain) on sale and retirement of assets. We define Adjusted EBITDA as net income (loss) before the deduction of income taxes, interest expense, net, repurchase of debt, transaction costs, depreciation and amortization, stock-based compensation, business realignment costs, impairment of goodwill, impairment of long-lived and intangible assets, impairment of investments, net (income) loss from discontinued operations, net of income taxes, net (loss) gain on sale and retirement of assets and other expense (income) net. We define Adjusted EBITDA (Excluding Political) as Adjusted EBITDA less political net revenue, net of a fifteen percent deduction to account for estimated national representative firm fees, music licensing fees and sales commissions expense. Adjusted Net Income is defined as net income (loss) before the deduction of transaction costs, business realignment costs, impairment goodwill, impairment of long-lived and intangible assets, impairment of investments, net loss (gain) on sale and retirement of assets, gain on repurchase of debt and insurance recoveries, net income attributable to non-controlling interest, net of income taxes, and net loss from discontinued operations, net of income taxes. Adjusted Net Income Per Share is defined as Adjusted Net Income divided by the weighted average shares outstanding. We define Net Leverage as our total outstanding indebtedness, net of our total cash balance as of June 30, 2021, divided by our Adjusted EBITDA for the twelve months ended June 30, 2021. These measures do not represent, and should not be considered as alternatives to or superior to, financial results and measures determined or calculated in accordance with GAAP. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. You should be aware that in the future we may incur expenses or charges that are the same as or similar to some of the adjustments in the presentation, and we do not infer that our future results will be unaffected by unusual or non-recurring items. In addition, these non-GAAP measures may not be comparable to similarly-named measures reported by other companies.

We use Adjusted Operating Income to evaluate the operating performance of our business segments. We use Adjusted EBITDA and Adjusted EBITDA (Excluding Political) to facilitate company-to-company operating performance comparisons by backing out potential differences caused by variations in capital structures (affecting interest expense), taxation and the age and book depreciation of facilities and equipment (affecting relative depreciation expense), which may vary for different companies for reasons unrelated to operating performance, and to facilitate year over year comparisons, by backing out the impact of political revenue which varies depending on the election cycle and may be unrelated to operating performance. We use Adjusted Net Income and Adjusted Net Income Per Share to assess total company operating performance on a consistent basis. We use Net Leverage to measure the Company's ability to handle its debt burden. We believe that these measures, when considered together with our GAAP financial results, provide management and investors with a more complete understanding of our business operating results, including underlying trends, by excluding the effects of transaction costs, net loss (gain) on sale and retirement of assets, business realignment costs, certain impairments, and net income (loss) from discontinued operations. Further, while discretionary bonuses for members of management are not determined with reference to specific targets, our board of directors may consider Adjusted Operating Income, Adjusted EBITDA, Adjusted EBITDA (Excluding Political), Adjusted Net Income, Adjusted Net Income Per Share and Net Leverage when determining discretionary bonuses.

Investor Relations
Claire Yenicay
(203) 900-5555
investors@townsquaremedia.com

TOWNSQUARE MEDIA, INC.

CONSOLIDATED BALANCE SHEETS

(in Thousands, except share and per share data)

(unaudited)



June 30,
2021


December 31,
2020

ASSETS




Current assets:




Cash and cash equivalents

$

25,146



$

83,229


Accounts receivable, net of allowance of $6,945 and $7,051, respectively

54,689



58,634


Prepaid expenses and other current assets

11,455



12,428


Current assets held for sale

629




Total current assets

91,919



154,291


Property and equipment, net

107,764



111,871


Intangible assets, net

280,510



281,160


Goodwill

157,947



157,947


Investments

17,609



11,501


Operating lease right-of-use-assets

46,274



48,290


Other assets

1,503



2,948


Restricted cash

494



494


Total assets

$

704,020



$

768,502


LIABILITIES AND STOCKHOLDERS' EQUITY




Current liabilities:




Accounts payable

$

9,259



$

9,056


Deferred revenue

8,585



8,847


Accrued compensation and benefits

9,094



12,462


Accrued expenses and other current liabilities

21,365



21,524


Operating lease liabilities, current

7,387



7,517


Accrued interest

18,485



6,350


Total current liabilities

74,175



65,756


Long-term debt, less current portion (net of deferred finance costs of $9,536 and $2,369, respectively)

540,464



543,428


Deferred tax liability

13,167



10,326


Operating lease liability, net of current portion

41,860



44,661


Other long-term liabilities

3,435



3,576


Total liabilities

673,101



667,747


Stockholders' equity:




Class A common stock, par value $0.01 per share; 300,000,000 shares authorized; 12,159,425 and 14,436,065 shares issued and outstanding, respectively

121



144


Class B common stock, par value $0.01 per share; 50,000,000 shares authorized; 815,296 and 2,966,669 shares issued and outstanding, respectively

8



30


Class C common stock, par value $0.01 per share; 50,000,000 shares authorized; 3,461,341 and 1,636,341 shares issued and outstanding, respectively

35



17


Total common stock

164



191


Additional paid-in capital

298,883



369,672


Accumulated deficit

(270,488)



(272,602)


Non-controlling interest

2,360



3,494


Total stockholders' equity

30,919



100,755


Total liabilities and stockholders' equity

$

704,020



$

768,502


TOWNSQUARE MEDIA, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in Thousands, Except Per Share Data)

(unaudited)



Three Months Ended June 30,


Six Months Ended June 30,


2021


2020


2021


2020

Net revenue

$

107,338



$

74,055



$

196,099



$

167,488


Operating costs and expenses:








Direct operating expenses, excluding depreciation, amortization, and stock-based compensation

71,591



64,408



136,118



135,958


Depreciation and amortization

4,996



4,761



9,725



10,045


Corporate expenses

5,452



7,570



9,586



13,960


Stock-based compensation

894



657



1,956



1,181


Transaction costs

390



1,213



5,105



2,240


Business realignment costs

66



456



256



2,167


Impairment of long-lived and intangible assets

95



28,655



95



107,715


Net loss (gain) on sale and retirement of assets

34



(10)



627



(12)


Total operating costs and expenses

83,518



107,710



163,468



273,254


Operating income (loss)

23,820



(33,655)



32,631



(105,766)


Other expense (income):








Interest expense, net

9,809



7,892



19,964



16,021


(Gain) loss on extinguishment and modification of debt



(1,159)



5,997



(1,159)


Other income, net

(40)



(961)



(377)



(734)


Income (loss) from operations before tax

14,051



(39,427)



7,047



(119,894)


Income tax provision (benefit)

3,977



(12,605)



3,082



(33,495)


Net income (loss)

$

10,074



$

(26,822)



$

3,965



$

(86,399)










Net income (loss) attributable to:








Controlling interests

$

9,432



$

(27,178)



$

2,883



$

(87,332)


Non-controlling interests

$

642



$

356



$

1,082



$

933










Basic income (loss) per share:








Attributable to common shares

$

0.58



$

(1.46)



$

0.14



$

(4.73)


Attributable to participating shares

$

0.58



$



$

0.14



$

0.08










Diluted income (loss) per share:

$

0.50



$

(1.46)



$

0.13



$

(4.73)










Weighted average shares outstanding:








Basic attributable to common shares

16,087



18,616



17,187



18,599


Basic attributable to participating shares

163



8,978



3,474



8,978


Diluted

18,837



27,594



22,730



27,577


Cash dividend declared per share

$



$



$



$

0.075


TOWNSQUARE MEDIA, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in Thousands)

(unaudited)



Six Months Ended June 30,


2021


2020

Cash flows from operating activities:




Net income (loss)

$

3,965



$

(86,399)


Adjustments to reconcile net income (loss) to net cash provided by operating activities:




Depreciation and amortization

9,725



10,045


Amortization of deferred financing costs

674



759


Non-cash lease (income) expense

(261)



94


Net deferred taxes and other

2,841



(33,734)


Provision for doubtful accounts

901



2,246


Stock-based compensation expense

1,956



1,181


Loss (gain) on extinguishment and modification of debt

5,997



(1,159)


Write-off of deferred financing costs



79


Trade activity, net

(7,876)



(4,352)


Impairment of long-lived and intangible assets

95



107,715


Net loss on sale and retirement of assets

627



...

(12)


Gain on repurchase of notes




Gain on insurance recoveries

(225)



(1,065)


Gain on lease settlement

(233)




Gain on sale of investments

(262)




...

Other

6




Changes in assets and liabilities, net of acquisitions:




Accounts receivable

2,799



17,993


Prepaid expenses and other assets

2,309



(774)


Accounts payable

88



420


Accrued expenses

(3,301)



(826)


Accrued interest

12,135



(85)


Other long-term liabilities

(729)



(274)


Net cash provided by operating activities - continuing operations

31,231



11,852


Net cash used in operating activities - discontinued operations

(33)



(175)


Net cash provided by operating activities

31,198



11,677


Cash flows from investing activities:




Purchase of property and equipment

(4,839)



(8,343)


Purchase of investments

(278)



(400)


Proceeds from insurance recoveries

225



1,172


Proceeds from sale of investments

532




Proceeds from sale of assets

307



102


Net cash used in investing activities

(4,053)



(7,469)


Cash flows from financing activities:




Repayment of term loans

(272,381)



(9,951)


Repurchase of 2023 Notes

(273,416)



(3,573)


Proceeds from the issuance of 2026 Notes

550,000




Prepayment fee on 2023 Notes

(4,443)




Deferred financing cost

(9,027)




Repurchase of Oaktree securities

(80,394)




Transaction costs related to Oaktree securities repurchase

(1,556)




Borrowings under the revolving credit facility



50,000


Repayment of borrowings under the revolving credit facility



(50,000)


Dividend payments

(60)



(4,201)


Proceeds from stock options exercised

9,702



49


Repurchase of stock

(1,400)




Cash distribution to non-controlling interests

(2,216)



(1,164)


Repayments of capitalized obligations

(37)



(20)


Net cash used in financing activities

(85,228)



(18,860)


Cash and cash equivalents and restricted cash:




Net decrease in cash, cash equivalents and restricted cash

(58,083)



(14,652)


Beginning of period

83,723



85,161


End of period

$

25,640



$

70,509


TOWNSQUARE MEDIA, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)

(in Thousands)

(unaudited)



Six Months Ended June 30,


2021


2020

Supplemental Disclosure of Cash Flow Information:




Cash payments:




Interest

$

7,151



$

15,746


Income taxes

484



444






Supplemental Disclosure of Non-cash Activities:




Dividends declared, but not paid during the period



22


Investments acquired in exchange for advertising(1)

$

6,100



$

2,300


Property and equipment acquired in exchange for advertising(1)

1,642



2,574


Accrued capital expenditures

183



810


Accrued financing fees

150








Supplemental Disclosure of Cash Flow Information relating to Leases:




Cash paid for amounts included in the measurement of operating lease liabilities, included in operating cash flows

$

5,243



$

5,412


Right-of-use assets obtained in exchange for operating lease obligations

$

1,662



$

3,193






Reconciliation of cash, cash equivalents and restricted cash




Cash and cash equivalents

$

25,146



$

70,015


Restricted cash

494



494



$

25,640



$

70,509



(1) Represents total advertising services to be provided by the Company in exchange for equity interests and property and equipment acquired during each of the six months ended June 30, 2021 and 2020, respectively. As the advertising services are performed, revenue related to the services provided is reflected as a component of Trade activity, net within net cash provided by operating activities. As of June 30, 2021 and June 30, 2020, respectively, $2.2 million and $1.8 million, respectively, in advertising services remained to be provided in future periods in exchange for equity interests that were acquired during each of the six months ended June 30, 2021 and 2020. Refer to Note 6, Investments, in the accompanying Notes to Consolidated Financial Statements for additional information related to our investments.

TOWNSQUARE MEDIA, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS BY SEGMENT

(in Thousands)

(unaudited)



Three Months Ended

June 30,




Six Months Ended

June 30,




2021


2020


% Change


2021


2020


% Change

Advertising net revenue

$

85,924



$

57,137



50.4

%


$

155,681



$

131,672



18.2

%

Townsquare Interactive net revenue

20,220



16,886



19.7

%


39,217



33,413



17.4

%

Live Events net revenue

1,194



32



**



1,201



2,403



(50.0)

%

Net revenue

107,338



74,055



44.9

%


196,099



167,488



17.1

%

Advertising direct operating expenses

56,775



52,572



8.0

%


108,170



110,292



(1.9)

%

Townsquare Interactive direct operating expenses

14,125



11,742



20.3

%


27,190



23,720



14.6

%

Live Events direct operating expenses

691



94



635.1

%


758



1,946



(61.0)

%

Direct operating expenses

71,591



64,408



11.2

%


136,118



135,958



0.1

%

Depreciation and amortization

4,996



4,761



4.9

%


9,725



10,045



(3.2)

%

Corporate expenses

5,452



7,570



(28.0)

%


9,586



13,960



(31.3)

%

Stock-based compensation

894



657



36.1

%


1,956



1,181



65.6

%

Transaction costs

390



1,213



(67.8)

%


5,105



2,240



127.9

%

Business realignment costs

66



456



(85.5)

%


256



2,167



(88.2)

%

Impairment of long-lived and intangible assets

95



28,655



(99.7)

%


95



107,715



(99.9)

%

Net loss (gain) on sale and retirement of assets

34



(10)



**



627



(12)



**


Total operating costs and expenses

83,518



107,710



(22.5)

%


163,468



273,254



(40.2)

%

Operating income (loss)

23,820



(33,655)



**



32,631



(105,766)



**


Other expense (income):












Interest expense, net

9,809



7,892



24.3

%


19,964



16,021



24.6

%

(Gain) loss on extinguishment and modification of debt



(1,159)



**



5,997



(1,159)



**


Other income, net

(40)



(961)



(95.8)

%


(377)



(734)



(48.6)

%

Income (loss) from operations before tax

14,051



(39,427)



**



7,047



(119,894)



**


Income tax provision (benefit)

3,977



(12,605)



**



3,082



(33,495)



**


Net income (loss)

$

10,074



$

(26,822)



**



$

3,965



$

(86,399)



**



** not meaningful

The following table presents net revenue and Adjusted Operating Income by segment, for the three and six months ended June 30, 2021, and 2020, respectively (in thousands):


Three Months Ended
June 30,




Six Months Ended

June 30,




(Unaudited)


2021


2020


%Change


2021


2020


%Change

Advertising net revenue

$

85,924



$

57,137



50.4

%


$

155,681



$

131,672



18.2

%

Townsquare Interactive net revenue

20,220



16,886



19.7

%


39,217



33,413



17.4

%

Live Events net revenue

1,194



32



**



1,201



2,403



(50.0)

%

Net revenue

$

107,338



$

74,055



44.9

%


$

196,099



$

167,488



17.1

%

Advertising Adjusted Operating Income

29,149



4,565



538.5

%


47,511



21,380



122.2

%

Townsquare Interactive Adjusted Operating Income

6,095



5,144



18.5

%


12,027



9,693



24.1

%

Live Events Adjusted Operating Income (Loss)

503



(62)



**



443



457



(3.1)

%

Adjusted Operating Income

$

35,747



$

9,647



270.6

%


$

59,981



$

31,530



90.2

%


** not meaningful

The following table reconciles Net revenue to Net revenue, excluding political revenue on a GAAP basis by segment for the three and six months ended June 30, 2021, and 2020, respectively (in thousands):


Three Months Ended
June 30,




Six Months Ended

June 30,




(Unaudited)


2021


2020


%Change


2021


2020


%Change

Advertising net revenue

$

85,924



$

57,137



50.4

%


$

155,681



$

131,672



18.2

%

Townsquare Interactive net revenue

20,220



16,886



19.7

%


39,217



33,413



17.4

%

Live Events net revenue

1,194



32



**



1,201



2,403



(50.0)

%

Net revenue

$

107,338



$

74,055



44.9

%


$

196,099



$

167,488



17.1

%

Advertising political revenue

764



886



(13.8)

%


1,203



2,213



(45.6)

%

Townsquare Interactive political revenue












Live Events political revenue












Political revenue

$

764



$

886



(13.8)

%


$

1,203



$

2,213



(45.6)

%

Advertising net revenue (ex. political)

85,160



56,251



51.4

%


$

154,478



$

129,459



19.3

%

Townsquare Interactive net revenue (ex. political)

20,220



16,886



19.7

%


39,217



33,413



17.4

%

Live Events net revenue (ex. political)

1,194



32



**



1,201



2,403



(50.0)

%

Net revenue (ex. political)

$

106,574



$

73,169



45.7

%


$

194,896



$

165,275



17.9

%


** not meaningful

The following table reconciles on a GAAP basis net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted Net Income (Loss) for the three and six months ended June 30, 2021, and 2020, respectively (in thousands, except per share data):


Three Months Ended
June 30,


Six Months Ended

June 30,


(Unaudited)


2021


2020


2021


2020

Net income (loss)

$

10,074



$

(26,822)



$

3,965



$

(86,399)


Income tax provision (benefit)

3,977



(12,605)



3,082



(33,495)


Net income (loss) from operations before income taxes

14,051



(39,427)



7,047



(119,894)


Transaction costs

390



1,213



5,105



2,240


Business realignment costs

66



456



256



2,167


Impairment of long-lived and intangible assets

95



28,655



95



107,715


Net loss (gain) on sale and retirement of assets

34



(10)



627



(12)


(Gain) loss on extinguishment and modification of debt



(1,159)



5,997



(1,159)


Gain on insurance recoveries



(1,065)



(225)



(1,065)


Net income attributable to non-controlling interest, net of income taxes

(642)



(356)



(1,082)



(933)


Adjusted net income (loss) before income taxes

13,994



(11,693)



17,820



(10,941)


Income tax provision (benefit)

3,961



(3,738)



7,794



(3,057)


Adjusted Net Income (Loss)

$

10,033



$

(7,955)



$

10,026



$

(7,884)










Adjusted Net Income (Loss) Per Share:








Basic

$

0.62



$

(0.43)



$

0.58



$

(0.42)


Diluted

$

0.53



$

(0.43)



$

0.44



$

(0.42)










Weighted average shares outstanding:








Basic

16,087



18,616



17,187



18,599


Diluted

18,837



27,594



22,730



27,577


The following table reconciles on a GAAP basis net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA, Adjusted EBITDA (Excluding Political), and Adjusted EBITDA Less Interest, Capex and Taxes for the three and six months ended June 30, 2021, and 2020, respectively (dollars in thousands):


Three Months Ended
June 30,


Six Months Ended

June 30,


(Unaudited)


2021


2020


2021


2020

Net income (loss)

$

10,074



$

(26,822)



$

3,965



$

(86,399)


Income tax provision (benefit)

3,977



(12,605)



3,082



(33,495)


Interest expense, net

9,809



7,892



19,964



16,021


(Gain) loss on extinguishment and modification of debt



(1,159)



5,997



(1,159)


Depreciation and amortization

4,996



4,761



9,725



10,045


Stock-based compensation

894



657



1,956



1,181


Transaction costs

390



1,213



5,105



2,240


Business realignment costs

66



456



256



2,167


Impairment of long-lived and intangible assets

95



28,655



95



107,715


Other (a)

(6)



(971)



250



(746)


Adjusted EBITDA

$

30,295



$

2,077



$

50,395



$

17,570


Political Adjusted EBITDA

(649)



(753)



(1,023)



(1,881)


Adjusted EBITDA (Excluding Political)

$

29,646



$

1,324



$

49,372



$

15,689


Political Adjusted EBITDA

649



753



1,023



1,881


Net cash paid for interest

(1)



(12,309)



(7,151)



(15,746)


Capital expenditures

(2,979)



(2,717)



(4,839)



(8,343)


Cash paid for taxes

(414)



(444)



(484)



(444)


Adjusted EBITDA Less Interest, Capex and Taxes

$

26,901



$

(13,393)



$

37,921



$

(6,963)



(a) Other includes net loss (gain) on sale and retirement of assets and other income, net.

The following table reconciles net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA on a quarterly basis for the twelve months ended June 30, 2021 (dollars in thousands):


Three Months Ended


Twelve Months Ended


(Unaudited)


September 30,
2020


December 31,
2020


March 31,
2021


June 30,
2021


June 30,
2021

Net income (loss)

$

1,311



$

4,537



$

(6,109)



$

10,074



$

9,813


Income tax provision (benefit)

451



9,186



(895)



3,977



12,719


Interest expense, net

7,692



7,707



10,155



9,809



35,363


Loss on extinguishment and modification of debt





5,997





5,997


Depreciation and amortization

5,248



4,814



4,729



4,996



19,787


Stock-based compensation

430



473



1,062



894



2,859


Transaction costs

384



29



4,715



390



5,518


Business realignment costs

472



450



190



66



1,178


Impairment of long-lived and intangible assets

1,343







95



1,438


Other (a)

173



(164)



256



(6)



259


Adjusted EBITDA

$

17,504



$

27,032



$

20,100



$

30,295



$

94,931



(a) Other includes net loss (gain) on sale and retirement of assets and other income, net.

The following tables reconcile Operating income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted Operating Income (Loss) by segment for the three months ended June 30, 2021 and 2020 (in thousands):


Three Months ended June 30, 2021


(Unaudited)


Advertising


Townsquare
Interactive


Live Events


Corporate
and Other
Reconciling
Items


Total

Operating income (loss)

$

25,705



$

5,686



$

455



$

(8,026)



$

23,820


Depreciation and amortization

3,370



281



41



1,304



4,996


Corporate expenses







5,452



5,452


Stock-based compensation

74



128



3



689



894


Transaction costs







390



390


Business realignment costs





4



62



66


Impairment of long-lived and intangible assets







95



95


Net loss on sale and retirement of assets







34



34


Adjusted Operating Income

$

29,149



$

6,095



$

503



$



$

35,747





Three Months ended June 30, 2020


(Unaudited)


Advertising


Townsquare
Interactive


Live Events


Corporate
and Other
Reconciling
Items


Total

Operating (loss) income

$

(27,840)



$

4,989



$

(194)



$

(10,610)



$

(33,655)


Depreciation and amortization

3,722



133



130



776



4,761


Corporate expenses







7,570



7,570


Stock-based compensation

28



22



2



605



657


Transaction costs







1,213



1,213


Business realignment costs







456



456


Impairment of long-lived and intangible assets

28,655









28,655


Net gain on sale and retirement of assets







(10)



(10)


Adjusted Operating Income (Loss)

$

4,565



$

5,144



$

(62)



$



$

9,647


The following tables reconcile Operating income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted Operating Income by segment for the six months ended June 30, 2021, and 2020 (in thousands):


Six Months ended June 30, 2021


(Unaudited)


Advertising


Townsquare
Interactive


Live Events


Corporate
and Other
Reconciling
Items


Total

Operating income (loss)

$

40,425



$

11,047



$

330



$

(19,171)



$

32,631


Depreciation and amortization

6,864



697



86



2,078



9,725


Corporate expenses







9,586



9,586


Stock-based compensation

222



283



9



1,442



1,956


Transaction costs







5,105



5,105


Business realignment costs





18



238



256


Impairment of long-lived and intangible assets







95



95


Net loss on sale and retirement of assets







627



627


Adjusted Operating Income

$

47,511



$

12,027



$

443



$



$

59,981





Six Months ended June 30, 2020


(Unaudited)


Advertising


Townsquare
Interactive


Live Events


Corporate
and Other
Reconciling
Items


Total

Operating income (loss)

$

(93,299)



$

9,380



$

188



$

(22,035)



$

(105,766)


Depreciation and amortization

6,884



267



265



2,629



10,045


Corporate expenses







13,960



13,960


Stock-based compensation

80



46



4



1,051



1,181


Transaction costs







2,240



2,240


Business realignment costs







2,167



2,167


Impairment of long-lived and intangible assets

107,715









107,715


Net gain on sale and retirement of assets







(12)



(12)


Adjusted Operating Income

$

21,380



$

9,693



$

457



$



$

31,530


Cision
Cision

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SOURCE Townsquare Media, Inc.